Restructuring won’t affect Pfizer labs in Groton, officials say
Pharmaceutical giant Pfizer Inc. said Monday that it plans to separate its commercial operations into three distinct business segments, two of which will focus on therapeutic innovations and one overseeing generic medicines and drugs about to lose patent protection.
Pfizer spokeswoman Joan Campion said the changes would have no effect on the company's laboratories in Groton.
"This does not impact the work that is underway in Pfizer Worldwide Research and Development," Campion said in an email response to questions from The Day. "R&D remains a separate division from the commercial business segments and in that vein, labs won't be placed underneath these segments."
The changes, which roll together Pfizer's emerging and established markets operations, will go into effect in the United States in January 2014. In countries that require consultation with unions, the changes will occur after negotiations are complete.
"This represents the next steps in Pfizer's journey to further revitalize our innovative core, enhance the value of our consumer and off-patent established brands and maximize the use of our capital to create value for Pfizer and our shareholders," Ian Read, the company's chairman and chief executive, said in a statement.
Bloomberg news service reported Monday that the Pfizer reorganization was in anticipation of a future split of the company. Executives previously have confirmed that internal discussions are underway about splitting off Pfizer's innovative medicines from its generics business.
But Campion cautioned about reading too much into the restructuring.
"At this time, we have not made and are not in a position to make any decision regarding any potential future action that could involve an external split of these business segments," she said.
Geno Germano has been named president of the Innovative Products Group, which will be in charge of Pfizer medicines that are under patent protection beyond 2015 in areas including inflammation and immunology, cardiovascular-metabolic, neuroscience, pain, rare diseases and men's and women's health.
Amy Schulman, chief counsel at Pfizer, will be in charge of the other innovative business group that includes vaccines, oncology and consumer health care.
The so-called Value Products segment will be led by John Young. In addition to focusing on generic drugs, the business segment will oversee patented products that are expected to lose exclusivity through 2015 in most major markets. It also will be in charge of biosimilars and established-products collaborations.
"Each of these businesses will operate as a separate global business and require distinct specialization in terms of the science, talent, and market approach required to deliver value to consumers and patients," Pfizer said in a release.
Olivier Brandicourt will lead the transition to a regional structure tying together the three business segments.
Pfizer, which will report its second-quarter profits today, said it would begin listing financial results for each of these divisions in the first quarter of 2014.
"Our new commercial operating model will provide each business with an enhanced ability to respond to market dynamics, greater visibility and focus, and distinctive capabilities optimized to deliver value to patients and shareholders in the coming years," Read said.
In conjunction with the changes, Pfizer also announced that Douglas Lankler, chief compliance and risk officer, will be stepping up to general counsel when leadership changes take effect Jan. 1. Also, Rady Johnson, senior vice president and associate general counsel, will move to chief compliance and risk officer.
Reaction to the Pfizer reorganization was mixed.
"It looks like more uncertainty and disruption, which is not quite what Pfizer seems to need," industry insider Derek Lowe said in his "In The Pipeline" blog.
But Seamus Fernandez, an analyst for Leerink Swann in Boston, while noting that "at first glance, the structure of the three businesses may not be obvious fits," said in a note to clients that the three-pronged approach is "well-conceived" when taking into account the difficulty of integrating emerging markets and established markets into each of the segments.
Pfizer also announced an agreement Monday with UNICEF to provide up to 740 million doses of its vaccine Prevnar 13 at a reduced price to some of the world's poorest countries.
Pfizer's shares were up 17 cents Monday to $29.54 on the New York Stock Exchange.
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